Market On The Verge Of A Breakout Or Breakdown

​U.S. markets were weak to start Friday’s session despite a blowout GDP number as mixed corporate earnings weighed on the major indexes. The rebound off the lows in the second half of action held into the closing bell to give the bulls the overall weekly win.

The blue-chips lagged for the week, and the small-caps remain below a key resistance level, but the overall market momentum remains intact. A decisive close in record territory for the Dow and the Russell 2000 would be another positive sign for continued market strength over the near-term.

The Russell 2000 rallied 1% following the late day run to 1,592 and close just below this level. Lower resistance from February at 1,590-1,600 was cleared and held with continued closes above the latter leading towards a breakout to 1,625-1,640.

The S&P 500 advanced 0.5% to a fresh 2019 and session high of 2,939 into the closing bell. Lower resistance and the all-time high north of 2,940 held by a point with a close above 2,950 signaling additional momentum towards 2,975-3,000.

The Dow gained 0.3% after closing at its session peak of 26,543. Prior and lower resistance at 26,500-26,750 was cleared and held with a move above the latter getting 27,000 and all-time highs in play.

The Nasdaq was also up 0.3% after going out on its closing high of 8,146. Lower resistance at 8,150-8,200 held with momentum towards 8,250-8,400 and lifetime highs on closes above these levels.

For the week, the Nasdaq zoomed 1.9%, its 5th-straight weekly rise, and the Russell 2000 rose 1.7%. The S&P 500 jumped 1.2% while the Dow was down 16 points, or less than 0.1%.

Healthcare rose 1% to lead sector strength while Financials and Consumer Staples were up 0.9%. Energy and Technology were the only sector laggards after falling 1.3% and 0.4%, respectively.

The best performing sectors for the week included Communication Services (2.5%), Health Care (3.6%), and Technology (1.3%). Materials (-2.1%) and Energy (-1.4%) were the worst performing sectors along with the Industrials (-1%).


Cleveland-Cliffs (CLF) upgraded to Outperform from Neutral at Credit Suisse
Illinois Tool Works (ITW) upgraded to Neutral from Underweight at JPMorgan
Shutterfly (SFLY) upgraded to Outperform from Market Perform at Raymond James

Ferrari (RACE) downgraded to Hold from Buy at HSBC
Seagate (STXWealth Strength IndexAAPL is Extremely Up and trending Up) downgraded to Neutral from Buy at Edgewater Research
Western Digital (WDCWealth Strength IndexAAPL is Extremely Up and trending Up) downgraded to Underperform from Neutral at Baird

Before the open (EST):
​Armstrong World Industries (AWI), Cooper Tire & Rubber (CTB), Dorman Products (DORM), Insperity (NSP), Loews (L), Mercury General (MCY), Opus Bank (OPS), (SOHU), Spotify (SPOT)

After the close(EST):
​Alphabet (GOOGLWealth Strength IndexAAPL is Extremely Up and trending Up), Brooks Automation (BRKS), Chemed (CHE), Ethan Allen (ETH), Harmonic (HLIT), JBT (JBT), Logitech (LOGI), MGM resorts (MGM), One Gas (OGS), SBA Communications (SBACWealth Strength IndexAAPL is Extremely Up and trending Up), Texas Roadhouse (TXRH), Vornado Realty Trust (VNO), Western Digital (WDCWealth Strength IndexAAPL is Extremely Up and trending Up), Yum China Holdings (YUMC)

Monday’s economic reports (EST): 
Personal Income and Outlays – 8:30am
Dallas Fed Manufacturing Survey – 10:30am

Gold closed at $1,288.80 an ounce, up $9.10
Silver settled at $15.01 an ounce, up $0.13
Copper finished at $2.89 a pound, up $0.03
Crude Oil was at $62.80 a barrel, down $2.25
Bitcoin Investment Trust (GBTC) ended at $6.28 down $0.70

  I hope this helps you prepare for the trading day. Make it a great one!

   Todd Mitchell